All Forum Posts by: Dan Rudolph

"Her fee would be 1% of anything I make".  Most fee-only advisors charge around 1% of Assets Under Management (AUM), which usually equals your account balance.

If you make a profit of 10%, her fee is 1%*10% = 0.1%.  I don't think so.

Or maybe you meant that the charge is 1pp of anything you make, so then the fee would equal 1% of AUM while you are making money.  But in a year/quarter that you lose money you owe her nothing, or she owes you?  I don't think so.

Either way, she forgot to mention the sales commissions that she makes selling the things that her employer wants her to sell.  You should study up on the difference between the "suitability" standard and the "fiduciary" standard.

http://www.investopedia.com/articles/professionale...

Operating under the suitability standard, Edward Jones brokers can put their individual interests above that of their clients.

Edward Jones employs very likable, helpful, salespeople.  So do used car dealerships.  RUN AWAY!

From my personal experience, I would strongly recommend that you steer clear of Edward Jones. Either keep it simple with low fees with wealthfront.com, or, if you want a boutique investment firm, check out what Jerry Verseput at veripax.net has to offer. Tell him Dan Rudolph sent you.  (Jerry has a $500K minimum.)

Whoever you choose, you should make sure that you know what you are paying them.  Most people working with Edward Jones think that their advisor works for free, doing charity or something.  In reality, they get kickbacks from the investments that they put you in.  And this has a huge impact on the options that they offer.

IMO, now is really a bad time to buy into stocks.

https://seekingalpha.com/article/4094461-measure-c...

in the words of Mr. Buffett himself, "the price you pay determines your rate of return." Right now, this measure suggests investors are facing another lost decade just like the one that followed the last major stock market bubble.

Can anyone recommend a professional that could provide proper guidance?

Good answer, thanks. Sounds like he needs to do a rollover from his 401k to an IRA.

Options:

1) Terminate the plan for himself and his employees and then do the rollover.

2) Do an inservice rollover.  But he is under 59 1/2.  Does the law allow him to modify the plan to allow inservice rollovers for participants under 59 1/2?

Thanks @Dmitriy Fomichenko

Is there such a thing as a self-directed 401k for an employer/employee plan?

I have a friend that runs a small business with employees.  His company currently offers a 401k plan that he set up through Ameriprise.

He is heavily invested in this 401k and would like to be able to diversify his retirement into Real Estate.  Is there any way for him to modify the plan to enable this?

Don't accept the "standard" answers.  For starters, do not pay off your mortgage, it is one of the best tax advantages that uncle sam provides.  Do NOT listen to Dave Ramsey.  Instead understand the difference between good debt and bad debt.

https://www.youtube.com/watch?v=qRkc3HpOZcQ

I recommend that you begin by becoming a student of Rich Dad / Poor Dad.

But wait, when my stock broker says that TESLA is going to double in 6 months, and it doesn't, I can write that off, right? ;-)

The performance of VCSH, including dividends, can be viewed here:  http://stockcharts.com/freecharts/perf.php?VCSH

You can drag the timeline out to 7 years.